Monday, October 25, 2010

Weekly Market Update 23 Oct, 2010 by Tanmay G Purohit

Nifty has closed flat for the week with just 4 points higher closing at 6066. TCS was top gainer of the week with 9% gains followed by SUN PHARMA, RELIANCE, RANBAXY, CIPLA, HERO HONDA, SUZLON rose more than 3% each. SESA GOA was major loser with more than 8% loss. STERLITE, WIPRO, HDFC, JPASSO were other top losers from Nifty.
Q2 results have been good so far – For 307 companies announcing results Sales have risen 19% while Profits have grown by 28% led by other income growth of 76%. The food price index ease 15.53% while the fuel price index climbed 11.14% in the year to 9 October 2010 still high levels and RBI meet on November 2nd will be eyed
Weekly Technical View: Nifty has been unable to post gains for the last 3 weeks and if 5960-5930 support zone is broken correction can be fast. For becoming strong again Nifty has to trade above 6200 on a consistent basis and 6357 remains important resistance being all time high. Nifty has formed a lower top near 6121 against yearly high of 6284 and if the weakness continues break of 5930 can take Nifty towards 5800/5730 also.
 Support 5960/5815/5722 Resistance 6135/6246/6360

Sensex has closed the week higher by 40 points at 20165 and this is first positive close after 2 weeks of negativity. Sensex has formed a Harami Cross as Weekly Candlestick pattern which indicates indecision and as long as sustained move below 19700 or above 21000 close is not seen the trend would be only stock-specific. If 19700 is broken major support would be 18970. Sensex in its history so far hasn’t been able to close past 21000 and once that happens there can be a major shift towards bulls where 22500 can be next target.
Support 19770/19300/18980 Resistance 20370/20715/20900

Technical Call: MRPL (Rs 82.80):- The stock is near an important breakout on weekly graph and sustained move above Rs 85 can take stock higher towards Rs 87-89 also. Stock trades at 11 day high and above Rs 85 it would be a 10-week high. Buying can be considered near Rs 83-84 levels for Rs 88-90 as target and Rs 80 can be an adequate stop loss.


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